12 August, 2020

Japan picks Endo as top financial regulator, signals bank reforms to carry on

TOKYO (Reuters) – Japan’s government on Tuesday appointed career bureaucrat Toshihide Endo because it is top financial regulator, a move widely seen as an sign that reforms to make the banking sector more profitable will continue.

Endo, 59, currently director-general in the watchdog’s supervisory bureau, will succeed Financial Services Agency (FSA) Commissioner Nobuchika Mori, who in her three-year stint has pushed through reforms to increase investor faith in Japan’s currency markets and stimulate the flow of funds through its economy.

Endo will formally take up the post on July 17, as outlined by an announcement made on Tuesday by Finance Minister Taro Aso, that’s also minister in charge of financial services.

Under Mori’s leadership, the FSA has got corporate governance reforms made to have the Japanese market more inviting to investors, from boosting the volume of external directors on boards to encouraging more vocal engagement by investors.

Endo did closely with Mori on reforms and it is widely anticipated to continue Mori’s agenda, FSA sources have told Reuters.

“As regional banks face severe business environment amid the dwindling population, Mori has contributed greatly to the search for the way banks ought to be,” Aso told reporters from a cabinet meeting.

“I place right person the best place,” Aso added. “Endo may be more gentle-mannered than Mori.”

Since 2019, Endo has overseen the country’s financial firms along at the FSA’s supervisory bureau, and previously ran its inspection bureau.

Mori has held loan agencies partly responsible for the large amount of household savings sitting idle in bank deposits, and criticized investment professionals as a result of being employed in the ideal interests of their total clients.

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